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Portugal Homes
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In an effort to make housing more affordable to the young adult population, the Portuguese government put into effect fiscal exemptions for first-time buyers who are 35 years of age or less. With a significant number of foreigners applying for the incentive, this public guarantee is at risk of ending sooner than expected, which is a clear sign that those who are eligible for this benefit must act fast.
Why is this Government Incentive so Popular Among Expats and Overseas Buyers?
In August 2024, the Portuguese government implemented a strategic. This has been achieved through the exemption of two taxes: IMT (Imposto Municipal sobre Transmissões or Municipal Property Transfer Tax) and IS (Imposto de Selo, equivalent to stamp duty). With IMT rates ranging from 0% to 8% of a property’s value, it’s easy to see how this exemption can lead to significant savings. For instance, on a property costing €450,000—the maximum eligible for the incentive—savings on IMT alone can reach €36,000.
Although this cost reduction is highly attractive to any young adult looking to purchase their first home (another government-imposed criterion), foreigners under 35 have an additional advantage that older non-nationals don’t: the possibility of securing 100% mortgage financing from a bank. While this practice is already available to Portuguese citizens, expats and overseas buyers who don’t qualify for this new incentive can typically only borrow up to 85% of the property’s value.
Given the substantial savings and the ability to secure higher mortgage financing, it’s no surprise that, according to Portuguese newspaper , over 11,500 young buyers have applied for property loans under this initiative. Many of these applicants are non-Portuguese, with a significant proportion hailing from Brazil, various African countries, and the United States—making up the majority of foreign buyers benefiting from the IMT and Stamp Duty exemption.
